The idea of cloud computing remains simplicity itself, which is a key element of its appeal: Move the cost and complexity of procuring, provisioning, operating, and supporting an endless array of hardware, software, and enabling services for your business out to a 3rd party, which does it all it for you, yet more securely and with much greater economies of scale.

Not surprisingly, enabling such a strategic move is also the top business goal of the leading commercial cloud vendors, namely Amazon, Microsoft, and Google, who continue to vie vigorously for marketshare, technical leadership, and — some would say — the most interesting and valuable part of the market itself: The large, complex enterprise.

However, like all technology advances, the basic vision of a few leading commercial cloud vendors individually serving as the primary cloud provider to a large enterprise by supplying most of its data center needs was always going to be an over-simplistic one. Despite a lack of comprehensive cloud computing standards to enable it — other that de facto ones or cybersecurity standards — once an enterprise goes through the transformational effort of moving to the cloud, it has important options it simply didn’t have before.

Notably, this includes playing multiple clouds against each other to meet business objectives in terms of performance, cost, control, flexibility, and quality.

Yet the reality is that true multi-cloud in operation — meaning being able to substitute one cloud for another easily and in near real-time — is not yet an achievable goal for most enterprises. There are clear advantages in doing so by reducing costs, increasingly reliability, and avoiding the ever-present threat of vendor lock-in, while also conferring more sought-after control back to IT.

Hosting companies like Rackspace and others used to be able to provide a hedge that IT departments could use for such purposes, through services like co-location. However, most such providers have not been able to keep up with the overall capacity race or compete in the bruising cost efficiency battles that the top cloud providers can afford to wage.

That is, until recently however. A new generation of data center has begun to emerge which is designed to be multi-cloud ready, to serve as both a buffer and a foil against the dominance of the major commercial clouds, and make it easier to deal with everything from the looming General Data Protection Act (GDPR) to having “one throat to choke” when it comes to cloud operations, despite enterprises finding themselves already dependent on so many cloud providers.

Portrait of a modern multi-cloud data center

To get a better handle on these trends, I recently had an opportunity to explore in detail a new multi-cloud data center. Based in Europe, built and operated in Amsterdam by Interxion, and dubbed AMS8, this brand-new data center was designed from the ground-up to capitalize on the latest trends in enterprise cloud computing.

My host Piet Sjoukes, Director of Sales and Marketing, provided his perspective to me on why data centers like AMS8 are not only still relevant but real competitive differentiators when it comes to meeting the cloud needs of the enterprise. He also pointed out it’s not just businesses but top IT providers that are his customers as well, which today are just as dependent on commercial clouds as enterprises are.

Intent on putting Europe on the map when it comes to data center capabilities, Interxion’s Sjoukes explained situating data centers in places like Amsterdam and Marseille have significant advantages that are powering their customer growth, despite stiff competition in a crowded field.

First, is interconnection. Cities like Amsterdam, where AMS8 is situated, are located near large hubs of network connectivity — in this case the aggregated 27 Tb/s of the massive Amsterdam Internet Exchange — or Marseille, which is positioned at the vast interconnect to Asia and Africa, where both regions will be high growth markets for decades, well after other geographies have matured.

Second is less red tape and regulation. With lower taxes and legal overhead, locations like the Netherlands — and even increasingly remote places like Iceland — make it easier and less expensive to built and manage competitive data centers than in many other parts of the world.

Third is lower costs than in other locations in the region. With power half of the cost of Germany, data centers like AMS8, which are located in favorable operating expense geographies, can pass along much lower rates for what is the signature operating cost of cloud data centers. By choosing locations like the Netherlands, which has very favorable power reliability, a stable government, historically sustained investment in infrastructure, and a natural gas surplus that has paid for a lot of high quality investment in logistics, power, and connectivity, for example.

Going up the cloud stack: Enabling Multi-Cloud

Nevertheless, these strategies are still just table stakes for any competitive cloud data center today. The top players can execute on this just as well. Where the true differentiation comes in for next-generation independent data centers is in a) playing at a layer above the foundational commercial clouds to provide multi-cloud capabilities and b) offering nuanced co-location arrangements to facilitate high-value hybrid cloud scenarios. As a strategic example of the latter, Sjoukes cited the Patriot Act in the United States as something that properly situated co-location could be used to hedge against to keep control of corporate data.

Thus the modern data center, if wisely located and then selected by customers, can be used like the Swiss bank of old: A way to keep customer data as safe as possible from prying eyes.

This highlights an important topic with cloud in general: Trust has become one of the top issues when it comes to digital services. Data centers like AMS8, which are designed to enable highly secure and anonymized storage of customer data, are actually “going to restore trust. It’s very important not to be sloppy with the gift you are given from your customer (their data)” notes Psoukes. As a result, Interxion “has a principled stand. Never to look at cloud data, never even to have access to it”, by keeping it safe via strong encryption.

But what of the multi-cloud advantages specifically? Why would an enterprise or IT vendor choose a multi-cloud data center over direct engagement with cloud vendors like Microsoft, SAP, or Oracle? It boils down to connectivity. Only a major investment in interconnection and the highest speed access to large cloud providers can provide an effective hedge. Without going back to the expensive and hard-to-amortize on-premises data center investments of old, especially in network infrastructure, enterprises today must find an agnostic multi-cloud data center that they can partner with.

This is where Interxion and other cloud providers believe they’ve found a high-value strategic niche that gives companies what they want: Easy switching between cloud providers with minimal upfront or operational expense, delivered via the benefits of using cutting-edge, top-end data center design. (Example: AMS8 has twin 160 meter cooling wells dug deep below the Netherlands to exchange ground water without disturbing the environment in any significant way, on par with the top commercial cloud facilities.)

What’s next for the future of independent data centers like AMS8? The rise of Internet of Things (IoT) and edge computing in general is going to be a major growth factor for one. Ever increasing digital regulation ala GDPR will be another, which is likely easier to implement in discrete cloud facilities. Finally, the advent of smart-everything (smart cities, smart buildings, smart roads, smart vehicles, etc.), which needs ubiquitous, high-speed regional computing facilities to operate.

But Psoukes believes, rightly in my analysis, that these trends only makes the center of the cloud even more valuable. The multi-cloud data center has a bright future in being the trusted broker for the cloud, with co-location as both the cloud transition model as well as high level insurance against many kinds of vital future case scenarios. This is good news in that it means there is likely a trong future for the cloud outside of the dominance of a handful of industry giants. By focusing on these strategic offerings, independent data centers can remain viable for the long term, positioning themselves as a gateway to their region, to the IT world, to new and trusted marketplaces, and becoming “a maker of prosperity” in the process.

Note: My interest in the evolution of data centers has grown recently as IT moves decisively out to the cloud. To conduct my research, Interxion paid only for my travel expenses to visit and tour their AMS8 data center. You can also viewa highlight videoI made of this new cloud facility as well.